REPUBLICANS LACK CREDIBILITY ON ECONOMY

Democrats Working to Thwart Ineffective, Misguided Tax Plan

For Immediate Release:

May 7, 2003

Contact:Stacey Farnen202-225-3130

WASHINGTON – House Democratic Whip Steny Hoyer (MD) and members of the Democratic leadership today blasted the Republican tax cut proposals, which will worsen the Bush job recession and do nothing to aid the economy. The following is Representative Hoyer’s statement as prepared for delivery:

“When it comes to the Republican Party’s tax proposals, I urge the American people to ask two very simple questions: ‘Do I trust Tom DeLay on the economy or do I trust renowned investor Warren Buffett?’ And, ‘Do I think that Federal Reserve Board Chairman Alan Greenspan might know a thing or two more than President Bush when it comes to the handling of the economy?’

Two years ago, Majority Leader DeLay boldly claimed that the President’s mammoth tax cut “is the right medicine for our economy. It is the best way to put people back to work and create jobs.” Statements like that should all but exterminate Tom DeLay’s credibility when it comes to making economic predictions.

Just look at the facts. Over the last two years, our economy has lost 2.7 million private-sector jobs, including half a million jobs in the last three months. Today, there are nearly 9 million jobless Americans, and the unemployment rate – at 6 percent – is at its highest level since 1994.

Two years ago, President Bush promised the American people: “Tax relief is central to my plan to encourage economic growth and we can proceed with tax relief without fear of budget deficits, even if the economy softens.”Again, the facts do not lie.

Economic growth? Today, we have the worst real GDP growth since World War II. No fear of budget deficits? After four years of surpluses, our nation faces a record budget deficit of $400 billion. Given the GOP’s abysmal track record, why should the American people possibly believe their claims now?

Last weekend, Warren Buffett charged that the President’s proposed tax cut on corporate dividends – an idea incorporated in the House GOP’s tax bill – unfairly favors the wealthy and he said there is no guarantee that it will stimulate the economy.

Chairman Greenspan, testifying before Congress, said: “I could be strongly supportive of certain types of tax cuts. If, however, in the process you get significant increases in deficits which induce a rise in long-term interest rates, you will be significantly undercutting the benefits.”

The American people need to ask themselves: Who do we believe when it comes to the economy? Tom DeLay, George Bush and the GOP, who are pushing a dividend tax cut that won’t create jobs? Or Warren Buffett, Alan Greenspan and Congressional Democrats, who urge fiscal responsibility and job creation?

There is virtually no question that the House GOP’s tax bill will throw our economy into a sea of deficit and debt, disproportionately benefit the most affluent citizens, steal from Social Security and pass the costs onto future generations. When it comes to the economy, the GOP has lost all credibility. Their claims have been bold, and boldly wrong.”